UAL Negotiations Resume in Chicago
Union negotiators for the United Airlines mechanics met this week in Chicago with the Company over the remaining open contract issues. The parties engaged in what were described as “intense negotiations” over the remaining open items and have reported made significant progress. Both sides and have agreed to continue discussions next week, starting February 1st, in an effort to make a final push to conclude negotiations.
AAWW Selected as 2010 Recipient of “Phoenix Award” by Air Transport World
In noting “its highly successful turnaround to achieve consistent profitability and operational reliability,” Air Cargo World magazine has announced that Atlas Air Worldwide Holdings (AAWW) has been selected as it’s 2010 winner of the magazines coveted “Phoenix Award.”
Commenting on the award, ACW Editorial Director Perry Flint said, “Atlas appears to have found a business model that enables profitability even in lean times and creates the possibility of strong earnings in more robust periods.”
The award is presented annually as an acknowledgement of airlines that have gone through an extraordinary transformation, and is being presented to AAWW, “for its highly successful turnaround to achieve consistent profitability and operational reliability.”
Despite the severe reductions in the global air cargo market that occurred in 2009, Atlas Air’s management maintained their focus on increased operational performance and a program of continuous improvement, which led the airline to increase their net income by 22%. For the first nine months of 2010, the airline further improved upon the 2009 numbers, with earnings increasing more than 100% over the same nine months of the previous year.
In a statement on the company website, William J. Flynn, President and Chief Executive Officer of AAWW, was quoted saying, “We are delighted that the strategic initiatives to transform our business have paid off and are being recognized by Air Transport World. We have continuously focused on improving our operating performance and increasing shareholder value. We attribute our success to the stellar efforts of our employees in delivering innovative, valued-added services and solutions to our customers around the globe and appreciate that their efforts are being recognized.”
Airline Division Director David Bourne, when notified of the announcement issued the following statement: “Atlas Air continues to break the mold and be a success in an extremely competitive worldwide air cargo business by not being afraid to be creative. We have seen it in the way the operate their business model and in the way they have worked with us to establish a new labor and management business model to improve working conditions and the quality of life for our members. With our new combined pilot contract that will soon be in place and a new first contract for the airlines flight dispatchers hopefully concluded soon, we look forward to watching Atlas grow as a successful airline, adding more jobs in both the pilot and dispatcher forces.” The pilots of AAWW comprise the combined units of Atlas Air and Polar Air Cargo, who are members of Local 1224. The dispatchers are members of Local 210.
The presentation of The Phoenix Award will be on February 8 in Washington, D.C., at Air Transport World’s annual dinner and celebration at the Renaissance Hotel.
Week In Review News Items
Labor Developments
The agreement comes after four years of negotiations involving Teamsters Local 2727, the Teamsters Airline Division, UPS and the National Mediation Board. The IBT said that the agreement’s key components include: an “industry-best top rate”; continued free healthcare benefits; significant retroactive pay and other lump sum payments for past years; and numerous work rule improvements, including a new Aviation Safety Awareness Program and company concessions that will bring vendor work in house.
Delta and labor unions seeking to organize the carrier's workers have shifted their clash from on-the-ground campaigns to voluminous legal filings, but the accusations are just as harsh. Unions for flight attendants and ground workers failed to win enough votes to represent Delta employees last year, and the National Mediation Board is weighing the unions' appeals for re-votes on grounds that the company illegally interfered in the elections.
Legislative, Safety & Regulatory
Russian President Dmitry Medvedev placed the blame on a lapse in security for allowing a suspected suicide bomber to kill at least 35 people and wound scores at Moscow's Domodedovo airport…and fliers traumatized by emergency landings and frightening events in the air can expect little or no help from U.S. airlines in dealing with the aftereffects. USA TODAY has found that the well-being of passengers who are traumatized in harrowing incidents can often be ignored or forgotten…Bill McGee worked in the airline industry for seven years before he became a journalist and a consumer advocate. A couple years ago, Consumer Reports gave him a very simple mandate. They called him in and said, "Can you give us an update on the state of airline safety?" He had no agenda, no real biases, and basically said, "Give me some time to go out and talk to some experts." And rather than talk to talking heads in Washington, he spoke to frontline people: to pilots, to mechanics, to FAA inspectors.
Airline Industry Finances & Structure
United Continental Holdings, the world's biggest carrier, had a fourth-quarter profit compared with a year-earlier loss after accounting for merger costs and other items, and US Airways touted its first profitable fourth quarter since 2006…after a decade of multibillion-dollar losses, U.S. airlines appear to be on course to prosper for years to come for a simple reason: They are flying less. By grounding planes and eliminating flights, airlines have cut costs and pushed fares higher.
US Airways President Scott Kirby says the carrier has approached United about joining in a transatlantic joint venture with anti-trust immunity. "If there's an opportunity to make it better by being part of a joint venture, we would like to do that," Kirby said, during US Airways' fourth-quarter earnings call…EU competition regulators blocked the proposed merger of Greece's Aegean Airlines and Olympic, the first veto in more than three years, saying a tie-up would have hurt competition.
Navigation
For years, airlines have been frustrated with the U.S. government's slow progress in adopting a satellite-based navigation system for landings and takeoffs. Ground-based instruments aren't reliable in foul weather, causing flight delays and diversions that waste fuel. To hasten the switch-over, the Federal Aviation Administration in 2007 enlisted the private sector's help. So far, the FAA has designed only 251 satellite-based procedures (step-by-step instructions about a flight path, much like the directions a driver gets from a car GPS system), now available to all carriers, and Boeing (BA) and General Electric (GE) have designed two. Thousands of routes need to be covered if all commercial airports are to switch to satellite navigation. Only 74 of the 450 U.S. commercial airports have satellite-guided systems in place.
Miscellaneous
The nationwide color-coded, terror-alert scale will be replaced by a point-specific system, U.S. Homeland Secretary Janet Napolitano announced Thursday. The new National Terror Advisory System, which Napolitano will focus on specific terror threats to potential targets. It will give law enforcement, airlines and potential targets critical information without unnecessarily alarming or confusing the public…though the public furor over the Department of Homeland Security and Transportation Security Administration’s “enhanced” security protocols has died down since last November, third party and independent activists have quietly continued to organize opposition to the measures. However, a lawsuit filed by former Minnesota governor Jesse Ventura’s against the DHS and TSA has now brought the controversial procedures back into the public spotlight.